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US Administration announces 34% tariffs on China, 20% on EU

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Re: US Administration announces 34% tariffs on China, 20% on EU

#991

Post by rapjr9 »

Gasp0de wrote: post #353

A possible retaliation by the EU could be to not enforce US intellectual property rights in the EU anymore. Or we could start taxing cloud companies, who, until now, have not paid taxes in the EU for profits that they generate in the EU.

Another possible retaliation is countries stop exports of particular products to the US. China has already done this with rare earth based materials. Asian countries could decide not to allow the US to buy specific small popular microcontrollers. This can be worked around, but it takes time to lay out a new PCB, port the firmware, and test it all, and that costs money.

Re: US Administration announces 34% tariffs on China, 20% on EU

#992

Post by SideQuark »

pjc50 wrote: post #627
TaurenHunter wrote: post #599

I don't see anyone mentioning that the United States needs to manage its massive national debt, currently in the trillions, by issuing Treasury securities. These securities mature at varying intervals and require continuous "rolling" or refinancing to pay off old debt with new borrowing. Significant rollovers are expected from April through September 2025, with additional short-term maturities due by June. Higher int…

Tariffs increase prices. This tends to cause a wage-price spiral, and indeed that's one of the stated objectives (increase US wages by onshoring manufacturing). The increase in prices and wages is inflation. This will cause the Treasury to raise rates to force contraction. Now, so far rates have indeed spiked downwards, but not a huge amount: https://tradingeconomics.com/united-states/government-bond-y... The next co…

Tariffs don’t increase jobs. Pretty much all Econ lit shows it lowering jobs, the same way it did during Trump I term and same as Smoot Hawley. It also moves manufacturing offshore for the same reasons Harley Davidson moved them to Europe last time - expensive materials here means expensive goods.

Next, since more expensive goods means less sales (see Ford last time), less is sold, so less workers are needed. Last Trump tariffs led to record farmer bankruptcies for a good economy, it led to ~300k manufacturing jobs loss compared to not having the tariffs, and MI had entered a manufacturing recession right before COVID hit.

If tariffs did even a fraction of the good Trump claims, they be used extensively by every country, by every state, by every manufacturer, etc.

Playing in a 21st century economy with long discredited 15th century tools will end as expected.

Re: US Administration announces 34% tariffs on China, 20% on EU

#993

Post by SideQuark »

bhouston wrote: post #783
TaurenHunter wrote: post #599

I don't see anyone mentioning that the United States needs to manage its massive national debt, currently in the trillions, by issuing Treasury securities. These securities mature at varying intervals and require continuous "rolling" or refinancing to pay off old debt with new borrowing. Significant rollovers are expected from April through September 2025, with additional short-term maturities due by June. Higher int…

Trump is a wildcard, but I could see the US defaulting on its debt, probably in some way that focuses the default burden on foreign countries holding US debt with some relief for domestic holders. I would definitely not be holding it over the coming few years.

Defaulting on the US debt would send the US into hyperinflation and likely the end of the US.

The US sells debt to US and world investors, at good rates (a few percent), and continually rolls over past debt with new issues. The US spends around 11% of budget on interest on this debt.

A default means the world stops lending at low rates. Triple rates triples the interest payments to 33% of the budget. There’s no possible way the govt will collect that much more, especially as the economy craters, and no group would likely cut all the benefits, since they’d simply get in-elected. So we’d do what countless other countries did throughout history: we’d print money to pay the bills.

Of course this devalues each dollar, so this accelerates, and there would be a massive implosion as the US gets cannibalized by whomever can extract value the quickest.

Default would be incredibly bad.

Re: US Administration announces 34% tariffs on China, 20% on EU

#994

Post by SideQuark »

gigatexal wrote: post #57

Americans have been hurt for 50 years … yes manufacturing going overseas was a huge change and many administrations didn’t do enough to help affected workers. Buuuuuut - placing tariffs on our allies that will likely lead to a recession makes no sense. Devaluing the dollar and subsidizing production in the US makes far more sense. But I’m not an economist or anything.

> yes manufacturing going overseas was a huge change and many administrations didn’t do enough to help affected workers

Manufacturing didn’t go overseas - it got automated. The US is still the world’s 2nd largest manufacturer, the share of GDP going to manufacturing has been flat since 1950, and so on.

What happened is automation made manufacturing need vastly fewer workers. Nothing is “being jobs back” from a fairy tale reason.

Re: US Administration announces 34% tariffs on China, 20% on EU

#995

Post by hattmall »

keithxm23 wrote: post #820
svara wrote: post #750

It's true that free trade is hugely beneficial to the US economy as a whole, particularly with the USD being the reserve currency. The flow of goods is balanced by a flow of US dollars to other countries, which are ultimately cycled back into the US financial system - enabling budget deficits and an abundance of capital to invest in high growth industries. The flip side of this is that it also drives inequality - the…

> but many on this very site would need to give up a little bit of their privilege to reduce the pain felt by many of their fellow citizens. Agreed. However, by imposing tariffs it is not the privileged who are going to be affected the most. The pain is felt most by the low-skill workers you mentioned earlier. If the solution was instead along the lines of changing tax-brackets to tax the 'privileged' more, that migh…

How can a lack of tariffs AND the presence of tariffs both hurt low skill workers. Secondly why do all of these countries have tariffs if they are so bad for the economy.

Re: US Administration announces 34% tariffs on China, 20% on EU

#996

Post by rhubarbtree »

uoaei wrote: post #669

I like to ask, "What would a Russian agent do to try to dethrone the USA as a global power?" * remove support from historic trading partners * break up NATO and similar military alliances * convince the world to distrust USD as default reserve currency * specifically make it harder to trade with China who makes a lot of our junk * remove a lot of the federal government workforce from their positions * convince those…

It does seem plausible that Trump is acting on behalf of Russia.

It also seems plausible that he is trying to enrich himself and his supporters.

It also seems plausible that he doesn’t understand economics.

I’m genuinely lost as to which of those is correct. Can anyone eliminate one or two?

Re: US Administration announces 34% tariffs on China, 20% on EU

#998

Post by Imustaskforhelp »

svara wrote: post #750

It's true that free trade is hugely beneficial to the US economy as a whole, particularly with the USD being the reserve currency. The flow of goods is balanced by a flow of US dollars to other countries, which are ultimately cycled back into the US financial system - enabling budget deficits and an abundance of capital to invest in high growth industries. The flip side of this is that it also drives inequality - the…

I mean , if money is going to go to the rich.

There is a simple mechanism to distribute the money from the rich back to middle class / poor.

Its called taxes.

Basically, Trump shouldn't have done tariff and instead just taxed the rich after a certain point.

Oh wait, I think that sounds familiar.

Of course I am not saying tax them 90% and of course, you might say that there are loopholes. How are we going to distribute money from stocks? And you are right. But the thing trump is doing isn't working or maybe its working as intended by trump being a chatgpt wrapper.

If even trump literally just sat and did nothing, it would have been more beneficial.

I mean, Europe also has a high tax rate, its not that bad to have a high tax rate if you genuinely want equality, though I presume nobody really wants that. And Lobbying is legal in america which really shocks me.

I had said it time and time again. Trust is like a glass ball,once broken it can't be recovered. I feel like people are however still in shock of that glass ball being fallen and are in disbelief, But you guys gotta know whom y'all elected is doing harm.

Polymarket and even goldman sachs etc. are predicting 60% chance of US recession

Re: US Administration announces 34% tariffs on China, 20% on EU

#1000

Post by Slava_Propanei »

svara wrote: post #750

It's true that free trade is hugely beneficial to the US economy as a whole, particularly with the USD being the reserve currency. The flow of goods is balanced by a flow of US dollars to other countries, which are ultimately cycled back into the US financial system - enabling budget deficits and an abundance of capital to invest in high growth industries. The flip side of this is that it also drives inequality - the…

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